ORLANDO, Fla., April 25,
2018 /PRNewswire/ -- (NYSE: TUP) Tupperware Brands
Corporation today announced first quarter 2018 operating
results.
Rick Goings, Chairman and CEO,
commented, "Due to our soft result on the top-line, as well as a
higher tax rate, adjusted earnings per share in the first quarter
was 10-cents below the low-end of our
January guidance range and 16% below the prior year in local
currency. The impact to our annual cash flow from lower earnings is
expected to be modest and more than offset by the sale of assets
under our revitalization program."
Goings continued, "We were pleased in the quarter with good
performances in China,
Mexico, Malaysia/Singapore, South
Africa, and the United
States and Canada, even
though we were disappointed overall. With the disruption from the
closure of the supply chain facility in France behind us, we remain confident in our
global growth strategy, especially the opportunity in emerging
markets. The Tupperware brand, management team and our 3.1 million
sales force are each strong and are our most significant source of
competitive advantage. With those assets in our arsenal, we will
forge ahead with our strategy to adapt and evolve through our
integrated use of digital tools, branded contact points and a
relevant earning opportunity that empowers and cultivates
confidence in women across the globe. It is based on the confidence
we have in our business prospects that today we announced a
$200 million opportunistic share
repurchase, while continuing to support our dividend."
First Quarter Executive Summary - (Comparisons with First
Quarter 2017)
- Net sales were $542.6 million,
down 2% (6% local currency), including a 2-point impact from the
closure of Beauticontrol in 2017. Emerging markets**, accounting
for 70% of sales, were up 3% (1% local currency). The most
significant contribution to the first quarter growth in local
currency sales was in China, along
with good results in Argentina,
CIS, Fuller Mexico, Malaysia/Singapore, Tupperware Mexico and Tupperware
South Africa, partially offset by India and Indonesia. Established market sales decreased
12% (19% local currency), including the impact of the Beauticontrol
closure. The local currency sales decreases were most significant
in France, Germany and Italy, partially offset by the United States and Canada.
- GAAP net income and diluted earnings per share were
$35.7 million and $0.70, versus $47.4
million and $0.93 in 2017,
respectively, reflecting the impact of lower sales, a higher tax
rate and pre-tax costs in connection with the Company's
re-engineering program that were $5
million, or $0.09, higher in
2018. Adjusted, diluted earnings per share were $0.91. This was 10-cents below the low-end of the January
guidance range due to lower sales and 6-cents from an increased tax rate in connection
with the U.S. Tax Cuts and Jobs Act of 2017(the "Tax Act"). Versus
the January guidance, there was a 1-cent positive impact on adjusted, diluted
earnings per share comparison from net stronger foreign exchange
rates, while there was a 7-cent
benefit versus the same period in 2017.
- Total sales force of 3.1 million was down 2%, a sequential
decrease of 5-points, reflecting higher standards to be included in
the sales force in the CIS and in the two South African businesses,
as well as a 2-point negative impact from removing the
Beauticontrol and NaturCare sales forces. Average active sellers in
the first quarter were down 8%, including a negative 3-point impact
related to Beauticontrol and NaturCare.
First Quarter Business Highlights - (Comparisons with First
Quarter 2017)
Europe: Segment sales were
down 4% (14% local currency).
- Emerging markets in Europe
increased 19% (10% local currency), mainly in Tupperware South
Africa, up 24% (11% local currency) and CIS, up 29% (26% local
currency).
- Established markets were down 15% (26% local currency), in
part, due to service issues in connection with the closure of the
French supply chain facility, most significantly impacting
Germany, down 17% (28% local
currency), France, down 32% (41%
local currency), and Italy, down
17% (28% local currency).
Asia Pacific: Segment sales
were down 3% (7% local currency).
- Emerging markets in Asia
Pacific were down 1% (5% local currency), primarily in
Indonesia, down 35% (34% local
currency) from a smaller, less active sales force. In addition,
India was down 33% (35% local
currency), reflecting challenges with the sales force size and
manager activity in light of government direct selling guidelines,
as well as a negative 6% impact from the goods and services tax
effective in July 2017. These
decreases were partially offset by increased sales in China, up 35% (24% local currency) on the
strength of significantly more members and continued leveraging of
the product portfolio, digital technologies and its 6,400 studios
(14% advantage over 2017).
North America: Segment sales
were up 3% (down 1% local currency), including a negative 7-point
local currency impact from Beauticontrol closure.
- Tupperware United States and Canada sales were up 9% (8% local currency),
including a positive impact from changes in revenue
recognition.
- Tupperware Mexico sales were up 13% (6% local currency) and
Fuller Mexico sales were up 14% (7% local currency).
South America: Segment sales
were down 5% (up 5% local currency).
- Brazil was down 2% (up 2%
local currency), reflecting a deceleration in sales growth due to
customer service issues impacting product availability, including a
customs strike, the over-sell of certain items, and quality issues
with a third party produced item, as well as on-going challenges in
the consumer spending environment. These factors negatively
impacted the number of sales force additions and new sales force
leaders promoted.
- Sales in Argentina were down
1% (up 26% local currency). Local currency comparison mainly
reflected price increases related to the highly inflationary
environment.
Revitalization Program
Under the Company's revitalization plan announced in
July 2017, it expects to incur a
total of $100 to $110 million in pretax costs, of which
$73 million has been recorded
starting in the second quarter of 2017 through the first quarter of
2018. The Company expects to incur an additional $24 million in 2018. Cash outflows associated
with the overall program are expected to total $90 to $100
million, including $22 million
paid through the first quarter of 2018, and an additional
$61 million expected to be paid in
2018. Both the cost and cash flow are before related asset sales
that could bring proceeds of up to $35 to $45 million
over time, including $5 million
received in connection with the sale of a building in the first
quarter of 2018 with an expected $20
million from additional assets sold in the second quarter of
2018. The program is expected to generate about $35 million of annualized benefits once fully
implemented. The Company expects to realize about two-thirds of the
annualized benefit in 2018. After reinvestment, a mid-teen dollar
benefit is expected in 2018, mainly in the second half of the year.
In addition, there was a $1.4 million
benefit in the first quarter of 2018, with an additional
$1.2 million benefit to be realized
in the second quarter, in connection with not having operating
losses from Beauticontrol in the first half of 2018 versus
2017.
U.S Tax Cuts and Jobs Act of 2017
In December 2017, the U.S.
government enacted the Tax Act that significantly changed the U.S.
corporate income tax system by, among other things, lowering the
U.S. corporate income tax rate and implementing a territorial tax
system.
The changes included in the Tax Act are broad and complex,
including the provision related to the Global Intangible Low-taxed
Income ("GILTI") tax. GILTI is currently expected to negatively
impact full-year earnings per share by 35
cents, although it is not expected to impact cash flow.
The final transition and GILTI impacts under the Tax Act may
differ from previously recorded estimates, possibly materially, due
to, among other things, changes in interpretations; legislative
action, including U.S. Treasury regulations and guidance; changes
in accounting standards or related interpretations; and updates or
changes to estimates the Company has utilized to calculate the
transition impacts, including impacts from changes to earnings
estimates. A different amount than reflected in this release could
be recorded related to transition impacts in the Company's 2018
unaudited financial statements included in its Form 10-Q expected
to be filed in early May, and/or additional
transition-related amounts could be recorded in the Company's
2018 financial statements later in the year.
2018 Outlook
Based on current business trends and foreign currency rates, the
Company's second quarter and fiscal 2018 full year outlook is
provided below.
Company Level
|
13 Weeks
Ended
|
|
13 Weeks
|
|
52 Weeks
Ended
|
|
52 Weeks
|
|
Jun. 30,
2018
|
|
Ended
|
|
Dec. 29,
2018
|
|
Ended
|
|
Low
|
High
|
|
Jul. 1,
2017
|
|
Low
|
High
|
|
Dec 30,
2017
|
|
|
|
|
|
|
|
|
|
|
USD Sales Growth vs
Prior Year
|
(2)
|
%
|
—
|
%
|
|
1
|
%
|
|
(1)
|
%
|
1
|
%
|
|
2
|
%
|
GAAP EPS
|
$1.16
|
|
$1.21
|
|
|
($0.35)
|
|
|
$3.98
|
|
$4.13
|
|
|
($5.22)
|
|
GAAP Pre-Tax
ROS
|
15.6
|
%
|
15.9
|
%
|
|
(2.2)
|
%
|
|
13.9
|
%
|
14.2
|
%
|
|
8.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Local
Currency+ Sales Growth vs
Prior Year
|
(2)
|
%
|
—
|
%
|
|
2
|
%
|
|
(2)
|
%
|
—
|
%
|
|
1
|
%
|
EPS Excluding
Items*
|
$1.14
|
|
$1.19
|
|
|
$1.21
|
|
|
$4.52
|
|
$4.67
|
|
|
$4.84
|
|
Pre-Tax ROS Excluding
Items*
|
15.3
|
%
|
15.7
|
%
|
|
14.6
|
%
|
|
15.3
|
%
|
15.5
|
%
|
|
14.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FX Impact on EPS
Comparison (a)
|
$—
|
|
$—
|
|
|
|
|
|
$0.05
|
|
$0.05
|
|
|
|
|
(a)
Impact of changes in foreign currency versus prior year is updated
monthly and posted at: Tupperware Brands Foreign Exchange
Translation Impact Update.
Full Year 2018
- There is a negative 1.7 and 1.4 point impact in the 2018 second
quarter and full year sales comparisons, respectively, from the
closure of Beauticontrol in 2017.
- Tax rate estimated at 34.5% on a U.S. GAAP basis and 32.1%
excluding items.
- Includes the gain on the sale of property under the Company's
re-engineering program expected to close in the second quarter of
2018. Excludes Orlando, Florida
land sales and additional re-engineering program related asset
sales that may occur.
- Excludes the impact on earnings per share of the announced
share repurchase.
Segment Level
- For the full year, sales are expected to be up by a low-single
digit in dollars (down 3 to 5% local currency) in Europe; up by a low-single digit in dollars
(down 1 to 3% local currency) in Asia
Pacific; even to down low single digits in dollars and local
currency in North America,
including a 6 pp negative impact from the closure of Beauticontrol;
and down by a low to mid-single digit in dollars (up mid-single
digits local currency) in South
America.
- Segment profit return on sales, excluding items, is expected to
be up about ½ point in Europe and
Asia Pacific, to increase almost 2
points in North America and to be
about even in South America.
$200 Million Share
Repurchase
The Company intends to repurchase in the open market in upcoming
months, an aggregate of $200 million
of its shares. It considers this repurchase to be exceptional
as it continues to target over time a debt-to-EBITDA ratio, as
defined under its revolving credit agreement, of 1.75X, and
continues to prioritize its quarterly dividend.
* See Non-GAAP Financial Measures Reconciliation Schedules.
** The Company classifies established market units as those
operating in Western Europe,
including Scandinavia, the United
States, Canada,
Australia and Japan and its remaining units as emerging
market units.
+ Local currency changes are measured by comparing
current year results with those of the prior year translated at the
current year's foreign exchange rates.
First Quarter Earnings Conference Call
Tupperware Brands will conduct a conference call today,
Wednesday, April 25, 2018, at 8:30 am
Eastern time. The conference call will be webcast and
accessible, along with a copy of this news release and slides
presented during the conference call, on
www.tupperwarebrands.com.
Tupperware Brands Corporation, through an independent
sales force of 3.1 million, is the leading global marketer of
innovative, premium products across multiple brands utilizing
social selling. Product brands and categories include
design-centric preparation, storage and serving solutions for the
kitchen and home through the Tupperware brand and beauty and
personal care products through the Avroy Shlain, Fuller Cosmetics,
NaturCare, Nutrimetics and Nuvo brands.
The Company's stock is listed on the New York Stock Exchange
(NYSE: TUP). Statements contained in this release, which are not
historical fact and use predictive words such as "estimates",
"outlook", "guidance", "expects", "target" or "will" are
forward-looking statements. These statements involve risks
and uncertainties that include impairment and other charges related
to purchase accounting goodwill and restructuring actions,
enactment related and ongoing impacts related to the Tax Act,
recruiting and activity of the Company's independent sales forces
relating to governmental actions and otherwise, the success of new
product introductions and promotional programs, governmental
approvals of materials for use in food containers and beauty,
personal care nutraceutical products, the success of buyers in
obtaining financing or attracting tenants for commercial and
residential developments, the effects of economic and political
conditions generally and foreign exchange risk in particular and
other risks detailed in the Company's periodic reports as filed in
accordance with the Securities Exchange Act of 1934, as
amended.
The Company updates each month the impact of changes in foreign
exchange rates versus the prior year, posting it on Tupperware
Brands Foreign Exchange Translation Impact Update. Other than
updating for changes in foreign currency exchange rates, the
Company does not intend to update forward-looking information,
except through its quarterly earnings releases, unless it expects
diluted earnings per share for the current quarter, excluding items
impacting comparability and changes versus its guidance of the
impact of changes in foreign exchange rates, to be significantly
below its previous guidance.
Non-GAAP Financial Measures
The Company has utilized non-GAAP financial measures in this
release, which are provided to assist readers' understanding of the
Company's results of operations. These amounts exclude certain
items that at times materially impact the comparability of the
Company's results of operations. The adjusted information is
intended to be indicative of the Company's primary operations, and
to assist readers in evaluating performance and analyzing trends
across periods. These results should be considered in addition to,
not as a substitute for, results reported in accordance with
GAAP.
The non-GAAP financial measures include sales adjustments to
remove the impact the 2017 closure of Beauticontrol. On comparisons
related to profit, the non-GAAP financial measures exclude
gains from the sale of property, plant and equipment and insurance
settlements related to casualty losses, other income in connection
with real estate related operations, inventory obsolescence and
operating losses in conjunction with decisions to exit, wind-down
or significantly restructure businesses along with asset sales
related to exited or restructured businesses, certain asset
retirement obligations, re-engineering including the exit of
businesses and fixed asset impairment charges, pension settlements
and significant discrete impacts of new tax laws upon
adoption. While the Company is engaged in a multi-year
program to sell land adjacent to its Orlando, Florida headquarters, and also
disposes of other excess land and facilities periodically, these
activities are not part of its primary business operations.
Additionally, amounts recognized in any given period are not
indicative of amounts that may be recognized in any particular
future period. For this reason, these amounts are
excluded as indicated. The Company excludes significant
charges related to casualty losses caused by significant weather
events, fires or similar circumstances. It also excludes any
related gains resulting from the settlement of associated insurance
claims. While these types of events can and do recur periodically,
they are excluded from indicated financial information due to their
distinction from ongoing business operations, inherent volatility
and impact on the comparability of earnings across periods. The
Company periodically records exit costs accounted for using the
applicable accounting guidance for exit or disposal cost
obligations and other amounts related to rationalizing its supply
chain operations and other re-engineering activities, including the
exit of businesses and upon liquidation of operations in a country,
the recognition in income of amounts previously recorded in equity
as a cumulative translation adjustment. Also, the Company excludes
the impact of changes in tax laws on cumulative deferred taxes from
items previously recorded as cumulative translation adjustments.
The Company believes these amounts are similarly volatile and
impact the comparability of earnings across periods. Therefore,
they are also excluded from indicated financial information to
provide what the Company believes represents a useful measure for
analysis and predictive purposes.
The Company believes that excluding from reported financial
information costs incurred in connection with a significant change
in its capital structure that is of a nature that would be expected
to recur sporadically, also provides a useful measure for analysis
and predictive purposes. The Venezuelan government over the last
several years has severely restricted the ability to translate
bolivars into U.S. dollars. Due to volatility in changes in the
mandated exchange rates, the Company's non-GAAP measures exclude
for analysis and predictive purposes, the impact from devaluations
on the bolivar denominated net monetary assets and other balance
sheet positions that impact near term income, since they appear in
the income statement at the exchange rate at which they were
originally translated rather than the exchange rate at which
current operating activity is being translated.
The Company has also elected to present financial measures
excluding the impact of amortizing the purchase accounting carrying
value of certain definite-lived intangible assets, primarily the
value of its Fuller trade name recorded in connection with the
Company's December 2005 acquisition
of the direct selling businesses of Sara Lee Corporation. The
amortization expense related to these assets will continue for
several years. Similarly, in connection with its evaluation
of the carrying value of acquired intangible assets and goodwill,
the Company has periodically recognized impairment charges.
The Company believes that these types of non-cash charges will not
be representative in any single reporting period of amounts
recorded in prior reporting periods or expected to be recorded in
future reporting periods. Therefore, they are excluded from
indicated financial information to also provide a useful measure
for analysis and predictive purposes.
As the impact of changes in exchange rates is an important
factor in understanding period-to-period comparisons, the Company
believes the presentation of results on a local currency basis, in
addition to reported results, helps improve readers' ability to
understand the Company's operating results and evaluate performance
in comparison with prior periods. The Company presents local
currency information that compares results between periods as if
current period exchange rates had been the exchange rates in the
prior period. The Company uses results on a local currency basis as
one measure to evaluate performance. The Company generally refers
to such amounts as calculated on a local currency basis, as
restated or excluding the impact of foreign currency. These results
should be considered in addition to, not as a substitute for,
results reported in accordance with GAAP. Results on a local
currency basis may not be comparable to similarly titled measures
used by other companies and are not measures of performance
presented in accordance with GAAP.
In information included with this release, the Company has
referred to Adjusted EBITDA and a Debt/Adjusted EBITDA ratio, which
are non-GAAP financial measures used in the Company's credit
agreement. The Company uses these measures in its capital
allocation decision process and in discussions with investors,
analysts and other interested parties, and therefore believes it is
useful to disclose this amount and ratio. The Company's calculation
of these measures is in accordance with its credit agreement, and
is set forth in the reconciliation from GAAP amounts in an
attachment to this release; however, the reader is cautioned that
other companies define these measures in different ways, and
consequently they may not be comparable with similarly labeled
amounts disclosed by others.
TUPPERWARE BRANDS
CORPORATION
|
|
FIRST QUARTER 2018
SALES FORCE STATISTICS*
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
|
|
|
|
|
|
|
All
Units
|
Reported
Inc/(Dec)
vs. Q1
'17
%
|
Restated+
Inc/(Dec)
vs. Q1
'17
%
|
f
|
|
Active
Sales
Force
|
Inc/(Dec)
vs. Q1
'17
%
|
f
|
|
Total
Sales
Force
|
Inc/(Dec)
vs. Q1
'17
%
|
f
|
Europe
|
(4)
|
(14)
|
|
a
|
103,873
|
|
3
|
|
|
788,764
|
|
—
|
|
Asia
Pacific
|
(3)
|
(7)
|
|
b
|
183,418
|
|
(16)
|
|
d
|
1,028,642
|
|
(4)
|
|
North
America
|
3
|
(1)
|
6
|
c
|
212,365
|
|
(11)
|
(4)
|
|
769,463
|
|
(6)
|
1
|
South
America
|
(5)
|
5
|
|
|
124,024
|
|
—
|
|
|
530,027
|
|
4
|
|
Total All
Units
|
(2)
|
(6)
|
(4)
|
|
623,680
|
|
(8)
|
(6)
|
|
3,116,896
|
|
(2)
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Emerging Market
Units
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
19
|
10
|
|
a
|
76,399
|
|
16
|
|
e
|
612,823
|
|
4
|
|
Asia
Pacific
|
(1)
|
(5)
|
|
b
|
162,996
|
|
(15)
|
|
d
|
943,002
|
|
(2)
|
|
North
America
|
12
|
6
|
|
c
|
196,898
|
|
(4)
|
|
|
657,565
|
|
—
|
|
South
America
|
(5)
|
5
|
|
|
124,024
|
|
—
|
|
|
530,027
|
|
4
|
|
Total Emerging Market
Units
|
3
|
1
|
|
|
560,317
|
|
(5)
|
|
|
2,743,417
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Estab. Market
Units
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
(15)
|
(26)
|
|
a
|
27,474
|
|
(20)
|
|
e
|
175,941
|
|
(11)
|
|
Asia
Pacific
|
(13)
|
(17)
|
|
b
|
20,422
|
|
(24)
|
|
|
85,640
|
|
(23)
|
|
North
America
|
(8)
|
(9)
|
8
|
|
15,467
|
|
(52)
|
7
|
|
111,898
|
|
(30)
|
2
|
South
America
|
—
|
—
|
|
|
—
|
—
|
|
|
—
|
—
|
|
Total Established
Market Units
|
(12)
|
(19)
|
(16)
|
|
63,363
|
|
(32)
|
(16)
|
|
373,479
|
|
(20)
|
(11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Sales force
statistics as collected by the Company and, in some cases, provided
by distributors and sales force. The Company classifies Established
Market Units as those operating in Western Europe, including
Scandinavia, the United States, Canada, Australia and Japan, and
its remaining units as Emerging Market Units. Active Sales Force is
defined as the average number of people ordering in each cycle over
the course of the quarter, and Total Sales Force is defined as the
number of sales force members of the units as of the end of the
quarter.
|
+ Local currency, or restated,
changes are measured by comparing current year results with those
of the prior year, translated at the current year's foreign
exchange rates.
|
Notes
|
a The
better active sellers than local currency sales comparison for
Europe for established markets reflected a significant
decrease in productivity in Germany and France related to customer
service issues related to the now closed French facility, and for
emerging markets a decrease in timing of fulfillment of orders in
Tupperware South Africa.
|
b The
larger active sellers than local currency sales decrease comparison
for Asia Pacific in the established markets came primarily from
Tupperware and NaturCare Japan. After their merger as of January
1st, the number of active sellers of NaturCare Japan who have a
much lower productivity level, decreased significantly. For
emerging markets the difference was primarily from higher
productivity in, and a mix shift toward, Tupperware China that does
not have a traditional sales force.
|
c The
better local currency sales than active sellers comparison for
North America in the emerging markets, reflected improvement in
productivity in Fuller Mexico.
|
d The
worse active than total sellers comparison in Asia Pacific emerging
markets was mainly from Tupperware Indonesia as key strategies have
yet to engage.
|
e The
better active than total sellers comparison in Europe emerging
markets was mainly from Tupperware CIS, Tupperware South Africa and
Avroy Shlain reduction in total sellers after a change in standards
for sales force additions effective Q1 2018. The established
markets had less active sellers than total sellers due to the
service issues connected with the now closed French
facility.
|
f
Comparison excluding amounts of Beauticontrol last year.
|
TUPPERWARE
BRANDS CORPORATION
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(UNAUDITED)
|
|
|
|
|
(In millions,
except per share data)
|
13 Weeks
Ended
|
|
13 Weeks
Ended
|
|
Mar
31,
2018
|
|
Apr
1, 2017
|
Net sales
|
$
|
542.6
|
|
|
$
|
554.8
|
Cost of products
sold
|
179.0
|
|
|
177.7
|
Gross
margin
|
363.6
|
|
|
377.1
|
|
|
|
|
Delivery, sales and
administrative expense
|
289.2
|
|
|
297.9
|
Re-engineering and
impairment charges
|
7.6
|
|
|
2.3
|
Gains on disposal of
assets
|
2.2
|
|
|
0.1
|
Operating
income
|
69.0
|
|
|
77.0
|
|
|
|
|
Interest
income
|
0.7
|
|
|
0.5
|
Interest
expense
|
11.1
|
|
|
11.6
|
Other expense,
net
|
0.2
|
|
|
1.7
|
Income before income
taxes
|
58.4
|
|
|
64.2
|
Provision for income
taxes
|
22.7
|
|
|
16.8
|
Net income
|
$
|
35.7
|
|
|
$
|
47.4
|
|
|
|
|
Net income per common
share:
|
|
|
|
Basic income per
share
|
$
|
0.70
|
|
|
$
|
0.94
|
Diluted income per
share
|
$
|
0.70
|
|
|
$
|
0.93
|
TUPPERWARE
BRANDS CORPORATION
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
(In
millions, except per share data)
|
13 Weeks
Ended
|
|
13 Weeks
Ended
|
|
Reported
|
|
Restated*
|
|
Foreign
|
|
Mar
31, 2018
|
|
Apr
1, 2017
|
|
%
|
|
%
|
|
Exchange
|
|
|
|
Inc
(Dec)
|
|
Inc
(Dec)
|
|
Impact*
|
Net
Sales:
|
|
|
|
|
|
|
|
|
|
Europe
|
$
|
143.9
|
|
|
$
|
149.5
|
|
|
(4)
|
|
|
(14)
|
|
|
$
|
18.6
|
Asia
Pacific
|
172.2
|
|
|
177.3
|
|
|
(3)
|
|
|
(7)
|
|
|
7.6
|
North
America
|
135.0
|
|
|
131.3
|
|
|
3
|
|
|
(1)
|
|
|
5.0
|
South
America
|
91.5
|
|
|
96.7
|
|
|
(5)
|
|
|
5
|
|
|
(9.2)
|
|
$
|
542.6
|
|
|
$
|
554.8
|
|
|
(2)
|
|
|
(6)
|
|
|
$
|
22.0
|
|
|
|
|
|
|
|
|
|
|
Segment
profit:
|
|
|
|
|
|
|
|
|
|
Europe
|
$
|
12.4
|
|
|
$
|
19.9
|
|
|
(38)
|
|
|
(46)
|
|
|
$
|
2.8
|
Asia
Pacific
|
37.9
|
|
|
40.0
|
|
|
(5)
|
|
|
(10)
|
|
|
2.1
|
North
America
|
19.0
|
|
|
15.8
|
|
|
20
|
|
|
14
|
|
|
0.8
|
South
America
|
17.3
|
|
|
18.2
|
|
|
(5)
|
|
|
3
|
|
|
(1.3)
|
|
86.6
|
|
|
93.9
|
|
|
(8)
|
|
|
(12)
|
|
|
4.4
|
|
|
|
|
|
|
|
|
|
|
Unallocated
expenses
|
(12.4)
|
|
|
(16.4)
|
|
|
(25)
|
|
|
(23)
|
|
|
0.5
|
Gains on disposal of
assets
|
2.2
|
|
|
0.1
|
|
|
+
|
|
|
+
|
|
|
—
|
Re-engineering and
impairment charges
|
(7.6)
|
|
|
(2.3)
|
|
|
+
|
|
|
+
|
|
|
—
|
Interest expense,
net
|
(10.4)
|
|
|
(11.1)
|
|
|
(6)
|
|
|
(6)
|
|
|
—
|
Income before
taxes
|
58.4
|
|
|
64.2
|
|
|
(9)
|
|
|
(16)
|
|
|
4.9
|
Provision for income
taxes
|
22.7
|
|
|
16.8
|
|
|
35
|
|
|
25
|
|
|
1.2
|
Net income
|
$
|
35.7
|
|
|
$
|
47.4
|
|
|
(25)
|
|
|
(30)
|
|
|
$
|
3.7
|
|
|
|
|
|
|
|
|
|
|
Net income per share
(diluted)
|
$
|
0.70
|
|
|
$
|
0.93
|
|
|
(25)
|
|
|
(30)
|
|
|
$
|
0.07
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of diluted shares
|
51.3
|
|
|
51.0
|
|
|
|
|
|
|
|
|
|
|
* 2018 actual
compared with 2017 translated at 2018 exchange rates
|
|
|
+ Greater
than 100% increase
|
|
|
TUPPERWARE BRANDS
CORPORATION
|
NON-GAAP FINANCIAL
MEASURES
|
(UNAUDITED)
|
|
|
|
|
(In
millions, except per share data)
|
13 Weeks Ended Mar
31, 2018
|
|
13 Weeks Ended Apr
1, 2017
|
|
Reported
|
|
Adj's
|
|
Excl
Adj's
|
|
Reported
|
|
Foreign
Exchange
Impact
|
|
Adj's
|
|
Restated*
Excl
Adj's
|
Segment
profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
$
|
12.4
|
|
|
$
|
0.4
|
|
f
|
$
|
12.8
|
|
|
$
|
19.9
|
|
|
$
|
2.8
|
|
|
$
|
0.7
|
|
b
|
$
|
23.4
|
|
Asia
Pacific
|
37.9
|
|
|
0.6
|
|
a, b
|
38.5
|
|
|
40.0
|
|
|
2.1
|
|
|
0.4
|
|
a
|
42.5
|
|
North
America
|
19.0
|
|
|
2.8
|
|
a,g
|
21.8
|
|
|
15.8
|
|
|
0.8
|
|
|
1.4
|
|
a,b
|
18.0
|
|
South
America
|
17.3
|
|
|
0.4
|
|
a,c
|
17.7
|
|
|
18.2
|
|
|
(1.3)
|
|
|
0.4
|
|
a,c
|
17.3
|
|
|
86.6
|
|
|
4.2
|
|
|
90.8
|
|
|
93.9
|
|
|
4.4
|
|
|
2.9
|
|
|
101.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unallocated
expenses
|
(12.4)
|
|
|
—
|
|
|
(12.4)
|
|
|
(16.4)
|
|
|
0.5
|
|
|
—
|
|
|
(15.9)
|
|
Gains on disposal of
assets
|
2.2
|
|
|
(2.2)
|
|
d
|
—
|
|
|
0.1
|
|
|
—
|
|
|
(0.1)
|
|
d
|
—
|
|
Re-engineering and
impairment charges
|
(7.6)
|
|
|
7.6
|
|
e
|
—
|
|
|
(2.3)
|
|
|
—
|
|
|
2.3
|
|
e
|
—
|
|
Interest expense,
net
|
(10.4)
|
|
|
—
|
|
|
(10.4)
|
|
|
(11.1)
|
|
|
—
|
|
|
—
|
|
|
(11.1)
|
|
Income before
taxes
|
58.4
|
|
|
9.6
|
|
|
68.0
|
|
|
64.2
|
|
|
4.9
|
|
|
5.1
|
|
|
74.2
|
|
Provision for income
taxes
|
22.7
|
|
|
(1.3)
|
|
h
|
21.4
|
|
|
16.8
|
|
|
1.2
|
|
|
0.8
|
|
h
|
18.8
|
|
Net income
|
$
|
35.7
|
|
|
$
|
10.9
|
|
|
$
|
46.6
|
|
|
$
|
47.4
|
|
|
$
|
3.7
|
|
|
$
|
4.3
|
|
|
$
|
55.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share
(diluted)
|
$
|
0.70
|
|
|
$
|
0.21
|
|
|
$
|
0.91
|
|
|
$
|
0.93
|
|
|
$
|
0.07
|
|
|
$
|
0.08
|
|
|
$
|
1.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* 2018 actual
compared with 2017 translated at 2018 exchange rates.
|
a Amortization of
intangibles of acquired beauty units.
|
b Pension settlement
costs.
|
c As a result of
devaluations in the Venezuelan bolivar, the Company had negative
impacts of $0.2 million in the first quarter of both 2018 and
2017. These amounts
were related to expense from re-measuring bolivar denominated net
monetary assets at the lower exchange rates at the times of
devaluations, along with the impact
of recording in income amounts on the balance sheet when the
devaluations occurred, primarily inventory, at the exchange rates
at the time the amounts were made
or purchased, rather than the exchange rates in use when they were
included in income.
|
d Gains on disposal
of assets in 2018 mainly relate to disposal of Beauticontrol
assets, and in 2017 related to an insurance settlement.
|
e In both years,
re-engineering and impairment charges were primarily related to
severance costs incurred for headcount reduction in several of the
Company's
operations in connection with changes in its management and
organizational structures, as well the costs associated with the
closure of Beauticontrol, and the French
supply chain facility.
|
f Write-off of
inventory associated with the closure of units.
|
g Beauticontrol wind
down loss and inventory write-off
|
h Provision for
income taxes represents the net tax impact of adjusted
amounts.
|
See
information regarding non-GAAP financial measures in the attached
press release.
|
|
TUPPERWARE BRANDS
CORPORATION
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(UNAUDITED)
|
|
|
|
|
(In
millions)
|
13 Weeks
Ended
|
|
13 Weeks
Ended
|
|
March 31,
2018
|
|
April 1,
2017
|
Operating
Activities:
|
|
|
|
Net cash provided by
operating activities
|
$
|
(41.6)
|
|
|
$
|
(18.0)
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
Capital
expenditures
|
(15.2)
|
|
|
(16.0)
|
|
Proceeds from
disposal of property, plant & equipment
|
5.9
|
|
|
0.3
|
|
Net cash used in
investing activities
|
(9.3)
|
|
|
(15.7)
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
Dividend payments to
shareholders
|
(35.4)
|
|
|
(34.7)
|
|
Repurchase of common
stock
|
(1.0)
|
|
|
(0.5)
|
|
Repayment of
long-term debt and capital lease obligations
|
(0.5)
|
|
|
(0.4)
|
|
Net change in
short-term debt
|
97.2
|
|
|
67.6
|
|
Proceeds from
exercise of stock options
|
0.2
|
|
|
2.1
|
|
Net cash used in
financing activities
|
60.5
|
|
|
34.1
|
|
|
|
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
4.1
|
|
|
4.9
|
|
Net change in cash,
cash equivalents and restricted cash
|
13.7
|
|
|
5.3
|
|
Cash, cash
equivalents and restricted cash at beginning of year
|
147.2
|
|
|
96.0
|
|
Cash, cash
equivalents and restricted cash at end of period
|
$
|
160.9
|
|
|
$
|
101.3
|
|
TUPPERWARE BRANDS
CORPORATION
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(UNAUDITED)
|
|
|
|
|
(In
millions)
|
Mar 31,
2018
|
|
Dec 30,
2017
|
Assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
157.0
|
|
|
$
|
144.1
|
|
Other current
assets
|
543.9
|
|
|
486.4
|
|
Total current
assets
|
700.9
|
|
|
630.5
|
|
|
|
|
|
Property, plant and
equipment, net
|
284.1
|
|
|
278.2
|
|
Other
assets
|
493.5
|
|
|
479.3
|
|
Total
assets
|
$
|
1,478.5
|
|
|
$
|
1,388.0
|
|
|
|
|
|
Liabilities and
Shareholders' Equity:
|
|
|
|
Short-term borrowings
and current portion of long-term debt
|
$
|
234.3
|
|
|
$
|
133.0
|
|
Accounts payable and
other current liabilities
|
490.5
|
|
|
525.8
|
|
Total current
liabilities
|
724.8
|
|
|
658.8
|
|
|
|
|
|
Long-term
debt
|
605.0
|
|
|
605.1
|
|
Other
liabilities
|
249.0
|
|
|
243.5
|
|
Total shareholders'
equity
|
(100.3)
|
|
|
(119.4)
|
|
Total liabilities and
shareholders' equity
|
$
|
1,478.5
|
|
|
$
|
1,388.0
|
|
TUPPERWARE BRANDS
CORPORATION
|
NON-GAAP FINANCIAL
MEASURES OUTLOOK RECONCILIATION SCHEDULE
|
April 25,
2018
|
(UNAUDITED)
|
|
|
|
|
|
|
|
Second
Quarter
|
|
Second
Quarter
|
(In millions,
except per share data)
|
2017
Actual
|
|
2018
Outlook(4)
|
|
|
|
Range
|
|
|
|
Low
|
|
High
|
Income (loss) before
income taxes
|
$
|
(12.7)
|
|
|
$
|
87.3
|
|
|
$
|
91.1
|
|
|
|
|
|
|
|
Income tax
|
$
|
5.0
|
|
|
$
|
27.9
|
|
|
$
|
29.2
|
|
Effective
Rate
|
(39)
|
%
|
|
32
|
%
|
|
32
|
%
|
|
|
|
|
|
|
Net Income (loss)
(GAAP)
|
$
|
(17.7)
|
|
|
$
|
59.4
|
|
|
$
|
61.9
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
+
|
|
|
+
|
|
|
|
|
|
|
|
Adjustments(1):
|
|
|
|
|
|
Gains on disposal of
assets
|
(3.1)
|
|
|
(9.9)
|
|
|
(9.9)
|
|
Purchase accounting
intangibles impairments
|
62.9
|
|
|
—
|
|
|
—
|
|
Re-engineering and
pension settlements
|
33.2
|
|
|
6.6
|
|
|
6.6
|
|
Net impact of
Venezuelan bolivar devaluations
|
1.4
|
|
|
—
|
|
|
—
|
|
Acquired intangible
asset amortization
|
2.0
|
|
|
2.0
|
|
|
2.0
|
|
Income
tax(2)
|
(16.2)
|
|
|
0.1
|
|
|
0.1
|
|
Net Income
(adjusted)
|
$
|
62.5
|
|
|
$
|
58.2
|
|
|
$
|
60.7
|
|
|
|
|
|
|
|
Exchange rate
impact(3)
|
—
|
|
|
—
|
|
|
—
|
|
Net Income (adjusted
and 2017 restated for currency changes)
|
$
|
62.5
|
|
|
$
|
58.2
|
|
|
$
|
60.7
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
(7)
|
%
|
|
(3)
|
%
|
|
|
|
|
|
|
Net income (loss)
(GAAP) per common share (diluted)
|
$
|
(0.35)
|
|
|
$
|
1.16
|
|
|
$
|
1.21
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
+
|
|
|
+
|
|
|
|
|
|
|
|
Net Income (adjusted)
per common share (diluted)
|
$
|
1.21
|
|
|
$
|
1.14
|
|
|
$
|
1.19
|
|
|
|
|
|
|
|
Net Income (adjusted
& restated) per common share (diluted)
|
$
|
1.21
|
|
|
$
|
1.14
|
|
|
$
|
1.19
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
(6)
|
%
|
|
(2)
|
%
|
|
|
|
|
|
|
Average number of
diluted shares (millions)
|
51.4
|
|
|
51.2
|
|
|
51.2
|
|
|
(1) Refer
to Non-GAAP Financial Measures section of attached release for
description of the general nature of adjustment
items.
|
(2)
Represents income tax impact of adjustments on an item-by-item
basis.
|
(3)
Difference between 2017 actual and 2017 translated at current
currency exchange rates.
|
(4)Excludes the impact on earnings per
share of the announced share repurchase.
|
TUPPERWARE BRANDS
CORPORATION
|
NON-GAAP FINANCIAL
MEASURES OUTLOOK RECONCILIATION SCHEDULE
|
April 25,
2018
|
(UNAUDITED)
|
|
|
|
|
|
|
|
Full
Year
|
|
Full
Year
|
(In millions,
except per share data)
|
2017
Actual
|
|
2018
Outlook(4)
|
|
|
|
Range
|
|
|
|
Low
|
|
High
|
Income before income
taxes
|
$
|
185.1
|
|
|
$
|
311.9
|
|
|
$
|
323.2
|
|
|
|
|
|
|
|
Income tax
|
$
|
450.5
|
|
|
$
|
107.9
|
|
|
$
|
111.5
|
|
Effective
Rate
|
243
|
%
|
|
35
|
%
|
|
35
|
%
|
|
|
|
|
|
|
Net Income, (loss)
(GAAP)
|
$
|
(265.4)
|
|
|
$
|
204.0
|
|
|
$
|
211.7
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
+
|
|
|
+
|
|
|
|
|
|
|
|
Adjustments(1):
|
|
|
|
|
|
Gains on disposal of
assets
|
$
|
(9.1)
|
|
|
$
|
(12.1)
|
|
|
$
|
(12.1)
|
|
Purchase accounting
intangibles impairment
|
62.9
|
|
|
—
|
|
|
—
|
|
Re-engineering and
pension settlements
|
74.4
|
|
|
33.2
|
|
|
33.2
|
|
Net impact of
Venezuelan bolivar devaluations
|
7.4
|
|
|
0.2
|
|
|
0.2
|
|
Acquired intangible
asset amortization
|
7.9
|
|
|
7.9
|
|
|
7.9
|
|
Income
tax(2)
|
370.2
|
|
|
(1.7)
|
|
|
(1.8)
|
|
Net Income
(adjusted)
|
$
|
248.3
|
|
|
$
|
231.5
|
|
|
$
|
239.1
|
|
|
|
|
|
|
|
Exchange rate
impact(3)
|
2.5
|
|
|
—
|
|
|
—
|
|
Net Income (adjusted
and 2017 restated for currency changes)
|
$
|
250.8
|
|
|
$
|
231.5
|
|
|
$
|
239.1
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
(8)
|
%
|
|
(5)
|
%
|
|
|
|
|
|
|
Net income, (loss)
(GAAP) per common share (diluted)
|
$
|
(5.22)
|
|
|
$
|
3.98
|
|
|
$
|
4.13
|
|
|
|
|
|
|
|
Net Income (adjusted)
per common share (diluted)
|
$
|
4.84
|
|
|
$
|
4.52
|
|
|
$
|
4.67
|
|
|
|
|
|
|
|
Net Income (adjusted
& restated) per common share (diluted)
|
$
|
4.89
|
|
|
$
|
4.52
|
|
|
$
|
4.67
|
|
|
|
|
|
|
|
% change from prior
year
|
|
|
(8)
|
%
|
|
(4)
|
%
|
|
|
|
|
|
|
Average number of
diluted shares (millions)
|
51.3
|
|
|
51.3
|
|
|
51.3
|
|
|
(1) Refer
to Non-GAAP Financial Measures section of attached release for
description of the general nature of adjustment
items.
|
(2)
Represents income tax impact of adjustments on an item-by-item
basis, as well as $375 million impact from adoption of new
tax law in the United States.
|
(3)
Difference between 2017 actual and 2017 translated at current
currency exchange rates.
|
(4)Excludes the impact on earnings per
share of the announced share repurchase.
|
TUPPERWARE BRANDS
CORPORATION
|
ADJUSTED EBITDA
AND DEBT/ADJUSTED EBITDA*
|
(UNAUDITED)
|
|
|
|
As of and for
the
four quarters ended
|
|
March
31, 2018
|
Adjusted
EBITDA:
|
|
Net income
(loss)
|
$
|
(277.1)
|
|
Add:
|
|
Depreciation and
amortization
|
61.4
|
|
Gross interest
expense
|
45.6
|
|
Provision for income
taxes
|
456.4
|
|
Equity
compensation
|
21.1
|
|
Pre-tax
re-engineering and impairment charges
|
69.1
|
|
Other non-cash
extraordinary, unusual or non-recurring charges
|
65.0
|
|
Deduct:
|
|
Cash paid for
re-engineering
|
(21.9)
|
|
Gains on land sales,
insurance recoveries, etc.
|
(11.2)
|
|
Total Adjusted
EBITDA
|
$
|
408.4
|
|
|
|
Consolidated total
debt
|
$
|
839.3
|
|
Divided by adjusted
EBITDA
|
408.4
|
|
Debt to Adjusted
EBITDA Ratio
|
2.06
|
|
|
* Amounts and
calculations are based on the definitions and provisions of the
Company's $600 million Credit Agreement dated September 11, 2013,
as amended and restated ("Credit Agreement") and, where applicable,
are based on the trailing four quarter amounts. "Adjusted EBITDA"
is calculated as defined for "Consolidated EBITDA" in the Credit
Agreement.
|
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SOURCE Tupperware Brands Corporation